@risk41
Your claims about debt being an issue are actually really silly. As CaptainBarnacles pointed out their Debt/EBITDA Ratio is really not stretched at all and will be increasing with the share buyback which they are using debt for. To answer your question as to where you get 230m EBITDA the PBT is 86.1m, add back in the Depreciation and Amortisation and non-recurring expenses and you get an underlying EBITDA of 118m for the half or 236m annualized.
Interest Expense would be under Finance costs which are listed in your screenshot as 4.1m for the half. If you think the interest rates are low its because they are. Below is the snapshot from the annual report with their interest rates. (Wish I could get an AUD loan at 1.25%)
View attachment 982432
Also given that the rates actually declined last financial year from what I would consider to be already low rates clearly the lenders see DMP as a low risk borrower.
@vontrader
You sure do like to play with fire it seems, shorting DMP and REA. Although I don’t necessary disagree with you that REA is presently overvalued I don’t think you realize some of the levers REA could easily pull that would have growth go through the roof.
Again your comment about the NPAT being under $65m is only for the half year. So if you annualize the NPAT then you are over 125m.
As for shorters having the most unbiased opinion of the business I had a bit of a chuckle at that comment. A shorter’s opinion is just as biased as a long, both feel that the share price will move in their favour. Arguably the most unbiased opinion will be from someone that is neither long or short and has no intention of taking a position either way.
@sachs
As for comparing it to other companies there aren’t many that I would say are comparable however Dominos on the NYSE has a listed PE of 38 with quite high EPS growth currently. MCD also on the NYSE with falling revenues over the last few years has a PE of 18. DMP by contrast is still growing both revenues and earnings and while there have been some missteps most recently in Japan overall the business has plenty of growth left in it.
I also feel that the company has been hurt recently by the growth in the global economy. Dominos is positioned at the cheap value end of the market and when people are well off I feel they are more likely to stump up extra and order from a local pizzeria. Dominos really shines when times are tough and people are tightening their belts. All of a sudden value becomes a higher priority. If you want evidence of this effect check out Dominos performance during the GFC.
Am I worried about the aggregators? Not really, it is the loss of a competitive advantage that they had with their online system however I don't feel that the person ordering from these aggregators was generally competing for the same dollars, Dominos does cheap and consistent well. I actually think that the aggregators will hurt businesses like Crust and Pizza Capers much more as their pizzas are priced similar to a boutique pizzeria yet their quality doesn't reach that same level.
Sadly I missed the fall sub 40 today however I have dipped my toes back in with a small trading parcel. Prior to the results I felt the company was going to stick within a trading range of 40-50, the results which I thought were below expectations make me feel that this will now spend the next 6 months trading between 38-48. The catalyst will be if management can achieve their goal of ~20% profit growth which I feel is a tall order after the first half results and will require flawless execution imo. Hopefully the price drops down to vontraders target so I can get some more shares at more attractive prices however I think the chances of getting to $30 are fairly slim.
(20min delay)
